The week ahead: 15-19 September

The week just gone was very light in economic data terms, with the main events being the Scottish referendum and increased tensions regarding US interest rates. These two events, the Scottish vote and the Federal Open Market Committee meeting, will be the most important in the week to come as well, along with UK unemployment and Bank of England minutes.

The Alibaba IPO is finally upon us as well, while a large number of UK companies also provide statements on their recent performance.

Economic reports

Monday

US industrial and manufacturing production (August), 2.15pm: Both data points for August are expected to weaken, indicating a slight slump in activity during the month. Market to watch: US dollar crosses

Tuesday

UK CPI (August), 9.30am: Having hit 1.6% in July, the YoY rate is expected to hold steady, with the MoM rate moving from -0.3% to 0.4%. Market to watch: GBP/USD, EUR/GBP

German ZEW (Sept), 10am: The economic sentiment index is expected to rise to 31.67, from 23.7 in August. Market to watch: DAX, EUR/USD, EUR/GBP

Wednesday

UK unemployment data, weekly earnings data (July, August): The claimant count is forecast to drop by 30,000 in August, with the July unemployment rate dropping to 6.3% from 6.4%. Average weekly earnings are expected to rise, to 0.7% excluding bonuses, from 0.6% in June. Market to watch: GBP/USD, EUR/GBP

Bank of England minutes (September): The crucial element to watch here will be the voting pattern, which was 7-2 in the last meeting to maintain rates and QE unchanged. Market to watch: GBP/USD, EUR/GBP

Eurozone CPI (August, final), 10am: The final reading for August is expected to edge back to 0.3% YoY. Market to watch: EUR/USD, EUR/GBP

US CPI (August), 1.30pm: Price growth in the US is expected to be 1.9% YoY in August, from 2% in July, while core CPI is expected to drop back to 1.85% from 1.9%. Market to watch: US dollar crosses

Federal Open Market Committee decision (September), 7pm: A surge in the US dollar, to its highest level in a year, has been driven by concerns that the Federal Reserve may have to raise rates at a faster than anticipated rate. The meeting is unlikely to see any change in policy, but the accompanying press conference could reveal whether the committee has begun to alter its assessment of the situation. Market to watch: all major indices and currency crosses

Thursday

Scottish referendum voting begins: The Scottish people go to the polls today to decide on the independence referendum. Current polls (as of Friday 12 September) have suggested the ‘No’ vote still has a slight lead, but the large number of undecided still means the result is too close to call. Market to watch: FTSE 100, FTSE 250, GBP/USD, EUR/GBP

UK retail sales (August), 9.30am: The YoY figure is forecast to accelerate to 4.8% from 3.4%, while the MoM figure is expected to be 0.3%, compared to 0.5% last month. Market to watch: GBP/USD, EUR/GBP

US initial jobless claims, housing starts & building permits (August), 1.30pm: Jobless claims jumped to 315K last week, while housing starts and building permits are expected to see a drop of 4.4% and 0.4% MoM respectively. Market to watch: US indices, dollar crosses

Philadelphia Fed index (September), 3pm: The index is expected to produce a reading of 23.3 for the month, down from 28 last month. Market to watch: US indices, dollar crosses

Friday

Scottish referendum results announced: The results are expected to emerge during the early morning. Market to watch: FTSE 100, FTSE 250, GBP/USD, EUR/GBP

Eurozone sovereign ratings updated: Major ratings agencies are expected to announce revisions to their ratings, and the particular one to watch will be France, whose economic situation continues to deteriorate. Market to watch: EuroStoxx 50, CAC40, DAX, EUR/USD, EUR/GBP

Canadian CPI (August), 1.30pm: The July reading was 2.1% YoY and -0.2% MoM, while the August figures are expected to be 2% and 0.5% respectively. Market to watch: USD/CAD

US leading indicators (August), 3pm: The leading index is a combination of various indicators designed to signal possible changes in the direction of economic activity. The figure is expected to be 0.4% in August, from 0.9% a month earlier. Market to watch: US indices, dollar crosses

Wednesday

Thursday

Friday

The big equity event of the week will be the Alibaba IPO. Reports on Friday indicate that the IPO has been oversubscribed at all price levels, with our IPO price (as of Friday 12 September) moving to an expected closing market cap of $210 billion. For more information, read Alastair McCaig’s article.

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